Discos likely to collect Rs43.34bn from power consumers under QTA

National Electric Power Regulatory Authority (NEPRA) would likely allow Discos to collect additional Rs2.18/unit charges or a cumulative Rs43.34 billion from consumers in their February-March 2023 bills, with a major chunk of capacity charges to the private generators.

These state-owned companies had sought approval of this big adjustment under the quarterly tariff adjustment (QTA) mechanism for the first quarter of FY2022/23 ie July to September 2022. On the petition of Discos, the power regulator held a public hearing on Tuesday. NEPRA Chairman Tauseef H Farooqi chaired the proceedings, while the authority's members from Khyber Pakhtunkhwa Maqsood Anwar Khan and Sindh Rafique Ahmad Shaikh were also present.

The regulator has reviewed these companies' data and also heard them as to ascertain whether their demand was justified. NEPRA would issue its final decision in a few days.

Discos in their petition had demanded an increase in tariff on account of capacity charges, transmission charges, market operation fees, the impact of transmission and distribution (T and D) losses, and other variable operation and maintenance charges for the first quarter of FY 2022-23.

Islamabad Electric Company (IESCO) had sought additional adjustment of Rs2.704 billion, Lahore Electric Supply Company (LESCO) Rs9.101 billion, Gujranwala Electric Power Company (GEPCO) Rs5.337 billion, Faisalabad Electric Supply Company (FESCO) Rs6.377 billion, Multan Electric Company (MEPCO) Rs10.688 billion, Peshawar Electric Supply Company (PESCO) Rs2.129 billion, Hyderabad Electric Supply Company (HESCO) Rs450 million, Quetta Electric Supply Company (QESCO) Rs3.663 billion, Sukkur Electric Power Company (SEPCO) Rs905 million and Tribal Electric Supply Company (TESCO)Rs1.282 billion.

Interestingly, these state-run power distribution companies have sought Rs31 billion on account of capacity charges, Rs6.431 billion on account of use of system charge (UoSC) and market operator fee (MOF), Rs2.169 billion for variable O and M, Rs7.408 billion on account of T and D losses in monthly FCA and negative adjustment of Rs4.248 billion of incremental units. Discos' inefficiencies, power losses, and theft in systems would be recovered from loyal consumers in the form of these recoveries.

Multiple taxes that the consumers were paying on these additional charges were another burden on the consumers. Electricity consumers were already paying Rs3.30/unit on account of quarterly adjustments for the fourth quarter (April-June 2022) effective till January 2023. In order not to overburden consumers with tariffs, the Ministry of Power has requested to implement quarterly adjustment for two months of February and March, NEPRA said.

This would be applicable on the consumers of all Discos except lifeline customers, NEPRA said. It will also not apply to K-electric consumers, the regulator said, adding that the authority will issue its detailed decision after further scrutiny of the data.